The Medicare program changes each year. See how 2014 Medicare changes will affect you.
Medicare is a federally-run program that is subject to annual changes. This includes the costs that beneficiaries must pay in order to get coverage. It can also involve the private health and drug insurance offerings for Medicare beneficiaries that are provided by insurance companies approved by the government. The availability, costs, and coverage of these private insurance plans, including Medicare Advantage and Medicare prescription drug plans, can also change each year. Understanding 2014 Medicare changes will help beneficiaries see how much they will pay for their health and medication costs in the coming year, and what type of coverage and/or private insurance plan(s) will work best for their health care needs in 2014.
Medicare Part A in 2014
Most people do not pay a monthly premium for Medicare Part A hospital insurance if they, or their spouse, have paid Medicare taxes while working. However, for those who do not get premium-free Part A coverage, the monthly premium is expected to decrease in 2014 to $426 per month, down from the $441 per month in 2013.
Here is how out-of-pocket costs associated with covered inpatient hospital and mental health stays will be covered by Medicare Part A in 2014:
- Deductible: $1,216 for each benefit period ($1,184 in 2013)
- Days 1-60: $0 coinsurance for each benefit period (same as in 2013)
- Days 61-90: $304 coinsurance per day of each benefit period ($296 in 2013)
- Days 91 and beyond: $608 coinsurance per each “lifetime reserve day” (up to 60 days in your lifetime) for each benefit period ($592 in 2013)
Beneficiaries are not responsible for any skilled nursing facility stay copayments for 1-20 days in a benefit period, but they are responsible for a $152 coinsurance for days 21-100 of a skilled nursing facility stay in a 2014 benefit period. This is an increase from $148 per day in 2013. They must pay for all skilled nursing facility stay costs spanning day 101 and beyond.
Medicare Part B in 2014
As announced by the Centers for Medicare and Medicaid Services (CMS), the Medicare Part B premium in 2014 will remain steady from the amount that was charged in 2013. The Part B premium in 2014 will be $104.90 per month, while the Part B deductible in 2014 will be $147 per year, the same amount beneficiaries paid in the previous year. Income-related monthly rates for Part B premiums will also remain the same in 2014. Beneficiaries will continue to pay 20% of most Part B covered services and nothing for most preventive services. However, if their health care provider does not accept Medicare assignment, which is the Medicare-approved amount for a service or supply, beneficiaries could pay up to 15% more.
Medicare Advantage in 2014
Medicare Advantage (MA) health plans can vary based on location and the insurance company offering the plan, but plan details may change each year as well. According to a recent analysis lead by Avalere Health, the availability of MA plans will drop about 5% from 2,664 plan options in 2013 to 2,522 plan options in 2014. However, the number of Health Maintenance Organization (HMO) plans is expected to see an increase of 2.6% from 1,675 HMO plans in 2014 to 1,718 HMO plans in 2014. Most of the other types of plans, including Preferred Provider Organization (PPO), Private Fee-For-Service (PFFS), and Special Needs Plans (SNPs), are expected to see a decrease in the number of Medicare Advantage plan offerings in 2014. Please note that the actual number of plans available for you to enroll in depends on the county and state in which you reside.
Medicare Part D in 2014
Similar to MA plans, Medicare prescription drug plans are also offered by private insurance companies that can determine how much they want to charge for their coverage, and what type of benefits to offer. This may change each year in addition to availability of these plans.
CMS has determined that costs associated with 2014 Part D prescription drug coverage will be changing. The prescription drug plan premiums are expected to average around $31, a slight increase from the average premium of $30 that has been charged for the past three years. Beneficiaries with incomes above a certain limit, as reported on their IRS income from two years ago in 2012, are responsible for a premium increase of $12.10 to $69.30 in addition to their plan premium. The average Part D deductible is expected to decrease by $15 to $310 in 2014.
In 2014, beneficiaries can expect to fall into the Medicare Part D donut hole (known as the coverage gap) after they have paid for their annual deductible and they and their plan have reached the initial coverage limit of $2,850 in prescription drug costs for the year. In the 2014 Part D donut hole, beneficiaries will receive a 28% discount on generic medications and a 52.5% discount on brand-name medications. They will exit the donut hole once the catastrophic coverage limit is reached. This happens by spending a total of $4,550 on prescription drug costs for the year, and then they will only be responsible for a minimum copayment of $2.55 on generic medications and $6.35 for other drugs in the catastrophic coverage period.
How will 2014 Medicare changes affect you in the upcoming year?
Medicare has neither reviewed nor endorsed this information.